Non-existing entities, other infractions make up $2.4bn FX backlog – Cardoso

In a recent interview with Arise TV, Dr. Olayemi Cardoso, the Governor of the Central Bank of Nigeria, disclosed startling revelations about the foreign exchange backlog he inherited upon assuming office. Out of the $7 billion in obligations, approximately $2.4 billion was flagged for irregularities, including requests from non-existent entities, absence of import documents, and other infractions.

Addressing concerns about the currency market's recent volatility, Cardoso outlined the challenges faced in addressing the backlog. He emphasized that the process of settling the obligations required a meticulous approach, especially considering the limited resources available.

To thoroughly scrutinize the backlog, the Central Bank enlisted the services of Deloitte management consultants to conduct a forensic audit. The results, according to Cardoso, were eye-opening. The audit revealed that a significant portion of the $7 billion had issues, with approximately $2.4 billion being associated with various infractions. These infractions ranged from the absence of valid import documents to instances of non-existent entities and discrepancies in the allocation of foreign exchange.

In response to the findings, Cardoso affirmed the Central Bank's commitment to paying only valid transactions. He highlighted the diverse nature of the infractions, including instances where entities received more foreign exchange than requested, others obtaining it without making any request, and cases where the legitimacy of the entities was questionable.

When questioned about the contentious transactions, Cardoso stated unequivocally, "We are not paying if you don't qualify." This assertive stance underscores the Central Bank's dedication to rectifying the irregularities in the foreign exchange obligations, ensuring transparency and accountability in the process.